How ERP Software Will Evolve in 2017

The global business landscape has significantly changed over the last few years. Today, enterprises are more fragmented. Many operate with global and mobile workforces and enterprise infrastructure extends beyond the firewall.

Employees are on the go, whether it is working from customer sites, from home or out of co-working spaces. As such, business data is always in motion since mobile phones, tablets and apps have become the tools of choice for accessing information.

Another important trend happening in the business world, especially in the manufacturing sector, is the Internet of Things (IoT). By “things”, we mean smart sensors that are attached to machines, manufacturing components and assembly lines. These interconnected sensors generate a large amount of operational data and exchange this information in order to take corrective actions or raise alerts. IoT takes automation in the manufacturing sector to a new level, and this new paradigm in manufacturing is known as Industry 4.0, or the Industrial Internet.

With new trends like IoT, robotics and increased automation in the manufacturing sector, enterprise resource planning software (ERP) is continually evolving to keep pace. This article explores some of the ERP software trends that enable customers to keep up with the pace of change.

The new age of manufacturingERP systems are crucial tools for manufacturers and their supply chains. However, the manufacturing industry itself is completely transformed, with assembly lines smarter, research and development (R&D) more innovative, and operations more streamlined and efficient.

Rich operational data is available every step of the production line and delivery process, enabling businesses to identify challenges or problems and solve them before problems escalate.

Sensors generate big dataManufacturers can now monitor every stage of the production line thanks to affordable sensor technology. But in order to make that data actionable, it must be Enabled by AI and smart algorithms, so that these sensors can function autonomously and make independent and timely decisions. They have cognitive capabilities to continuously learn from past actions—and become more intelligent over time.

As Industry 4.0 emerges, highly connected systems emerge that not only support production lines by allowing for higher productivity and efficient processes, but also give business decision makers access to real-time data to make better decisions and take action faster.

The return of traditional companiesToday, many people view start-up companies as the nucleus for innovation and driving global business and cultural change. Some of these companies have found themselves on the Fortune 100 list and have valuations in billions of dollars, with AirBnB and Uber as prominent examples.

However, traditional companies that have been around for decades are making a comeback through their digital transformation journeys. For example, companies like GE and Cisco are making drastic changes to their business processes by upgrading legacy infrastructure and improving machine productivity. These changes lead to improved operational costs and efficiency, and ensure that the company can deliver the best customer experience to support business growth.

American manufacturing giant GE manufactures aircraft engines, rail locomotives, gas and wind turbines and other machinery, and recently rebranded itself as “The Digital Industrial Company”1. Betting heavily on the Industrial Internet, it created a data services business around manufacturing, which ensures a continuous stream of revenue. For instance, clean energy companies can subscribe to a GE service that analyses data from wind farms and optimises the operation of numerous wind turbines—to yield higher clean energy.

Another example is Cisco 2, a manufacturer of routers and switches. Changing its business tag line to “Your Foundation for Digital Transformation”, it has not only transformed itself but also helps customers in their digital transformation journeys. For example, manufacturing customers use its Connected Factory3 solution to attain near zero downtime.

The emergence of ‘Smart ERP’Traditional applications like customer relationship management (CRM) and ERP continue to be important business tools, but it is important that they adapt to the rapidly evolving international business landscape to provide modern businesses with solutions that aid and support continued growth.

In 2017, expect to see more applications that analyse business data collected from various sources to offer business insight. Applications will support collaboration and facilitate data access through responsive interfaces. Artificial intelligence and advanced analytics will also transform business applications, making them more predictive and prescriptive.

In the age of bots, artificial intelligence and IoT, ERP systems will be smarter and more efficient. The smart factory and Industry 4.0 will give ERP systems a new lease of life, making the ERP systems of yesterday unrecognisable.

ERP systems are extending to the cloud, and will eventually become cloud only (Software-as-a-Service based) or available as a hybrid solution. In addition to being a cost effective solution, a SaaS model provides great flexibility and access to data at any time from any location. Businesses of all sizes are transitioning their infrastructure and data ecosystems into the cloud. These systems remove the burden of upgrades and management, freeing up valuable resources to focus on innovation and business growth.

Furthermore, cloud-based ERP systems will have embedded intelligence, enabled by smart algorithms. This means that the platform will offer more powerful analytics and predictive capabilities. This will make the ERP systems capable of gathering data on their own, processing it in real time, reaching conclusions and taking appropriate actions before the problem escalates.

ERP systems will also have the ability to produce information faster than ever to help businesses make smarter decisions and will provide a holistic and more elaborate view of the manufacturing and the supply chain—thereby helping businesses manufacture products that are more complex in a shorter time. This will translate to cost savings, innovation and profitability.

These ERP software developments will help companies remove barriers between their business and its customers to understand trends and product requirements better and to provide tools to help them innovate and grow their businesses in 2017.

Welcome to a new age of manufacturing and ‘smart ERP’.

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